![]() There have been legislation proposed by several Democrats to allow Medicare to negotiate for lower drug prices but the bills were opposed by Republicans and the drug industry. Instead, it left price negotiations to the for-profit insurance companies that sell Medicare Part D and Medicare Advantage plans. The Medicare Modernization Act that a Republican controlled Congress passed and President George Bush signed, prohibited Medicare from negotiating lower prices directly with drug companies. I'm guessing the drug lobbyists that some say wrote the 2003 law that created the Medicare prescription drug benefit, were fully aware of this. ""The anti-kickback statute prohibits manufacturers from giving or offering to give anything of value to someone to induce the purchase of any item or service for which payment may be made by a Federal health care program. Medicare beneficiaries however, aren't eligible for drug company copay assistance programs because of a 1970s anti-kickback statute. These increasing drug prices are then passed on to all consumers in higher premiums. Since patients pay a tiny amount of the actual cost of the drug, they are happy and unlikely to complain about high drug costs, enabling drug companies to continue to increase drug prices, which they do every year, sometimes twice a year. These drugs can cost hundreds if not thousands of dollars for a one month supply. ![]() It may seem altruistic of the drug company, but they are still making a nice profit because the insurer pays the bulk of the drug's cost. Because patients might opt not take to these drugs cuz of the cost, drug companies offer to pay most of their copays, leaving a patient to pay a minimal $5 or $10. They paid very little for these very expensive drugs and because they often were unaware of the actual cost of these drugs their insurer paid, they seldom protested these high drug prices.īecause of the high cost of brand name drugs, insurers and pharmacy benefit managers place these drugs in the highest tiers in a plan's drug formulary that have the highest copays/coinsurance. When on commercial insurance, they were usually eligible for drug company copay assistance programs. When individuals go on Medicare, they are shocked by the high coinsurance for the brand name/specialty drugs they take.
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